Fortnightly - Time-of-use ratehttps://www.fortnightly.com/tags/time-use-rate
enProving Smart-Grid Savingshttps://www.fortnightly.com/fortnightly/2010/06/proving-smart-grid-savings
<div class="field field-name-field-import-deck field-type-text-long field-label-inline clearfix"><div class="field-label">Deck:&nbsp;</div><div class="field-items"><div class="field-item even"><p>Real-world projects show tangible returns.</p>
</div></div></div><div class="field field-name-field-import-byline field-type-text-long field-label-inline clearfix"><div class="field-label">Byline:&nbsp;</div><div class="field-items"><div class="field-item even"><p>Alyssa Danigelis</p>
</div></div></div><div class="field field-name-field-import-bio field-type-text-long field-label-inline clearfix"><div class="field-label">Author Bio:&nbsp;</div><div class="field-items"><div class="field-item even"><p><b>Alyssa Danigelis </b>is a<i> Fortnightly </i>contributor and technology writer who blogs for Discovery News.</p>
</div></div></div><div class="field field-name-field-import-volume field-type-node-reference field-label-inline clearfix"><div class="field-label">Magazine Volume:&nbsp;</div><div class="field-items"><div class="field-item even">Fortnightly Magazine - June 2010</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even"><p>Much is riding on successful smart-grid deployments. Last fall, the Department of Energy set aside $11 billion for smart-grid creation. On top of that, many utilities are investing millions of their own money in grid improvements within their service areas. The expensive question remains: Will these investments pay off? Lacking a standard path for smart-grid development, utilities nationwide are venturing into unknown territory, putting their smart-grid business cases to the test.</p>
<p> </p>
<h4>Saving Power</h4>
<p><b>AEP’s gridSMART Ohio Project: </b><b>American Electric Power (AEP)</b></p>
<p>• 5.2 million customers</p>
<p>• $14.4 billion revenue (2008)</p>
<p>• Service areas in Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia, and West Virginia</p>
<p>• Approx. 39,000-MW generating capacity</p>
<p>• <b>Coverage</b>: 110,000 customers</p>
<p>• <b>Cost</b>: $150 million. The Department of Energy awarded $75 million and the rest is coming through a combination of monies subject to regulatory approval and in-kind donations from vendors that want to participate.</p>
<p>• The Project: AEP’s vast service territory poses significant challenges to implementing advanced grid technology because it encompasses everything from urban and suburban areas to mountainous and rural sections across eleven states. For that reason, AEP is taking a holistic approach with its smart-grid demonstration project in central Ohio. Working in partnership with the DOE, and with General Electric, AEP is investing in advanced technologies to operate the grid more efficiently. The utility aims to achieve this by installing smart meters, distribution automation equipment, demand-response technology, integrated voltage/var control, all the way through to smart appliances and home energy management systems. Smart appliances will help the utility determine how best to control them during peak periods without having a negative effect on residential customers’ lifestyles. The reason for the high $150 million price tag is that AEP is also planning to test community storage technologies, adding plug-in hybrid electric vehicles, and creating a cyber security center.</p>
<p>“Our demographics match the demographics across the nation within a few percentage points,” says Teri Flora, director of corporate communications for AEP Ohio. She’s realistic about the project and expects to see both successes and failures. “We’re confident that we can produce a demonstration project that will allow smart grid to progress across the country.”</p>
<p>• <b>Returns</b>: The utility expects that the improved efficiencies will reduce consumer costs by about $5.75 million over the course of the project. Consumption will be reduced by 18 megawatts and peak demand will be reduced by 15 megawatts. “By maintaining power at the appropriate level, supporting the vars, they’re eliminating waste on their network,” says Mark Hura, global smart-grid leader for General Electric. “They’re more efficient about how they’re delivering that power.” With the integrated volt/var control application alone, AEP is looking at curbing peak demand by up to 2 percent for the customers on the circuits that have the installation.</p>
<p>• <b>Timeline</b>: Smart-meter deployment began in December 2009. Hura says that GE has installed the smart-meter technology infrastructure and the advanced coordinated voltage/var technology on the network. The DMS system is being put into place and smart appliances likely will be in homes by the second half of this year. Some of the installations are expected to continue through summer 2011. Flora says 2010 is a test year for the utility. “Right now we’re still validating data, validating the technology, and looking at pricing options from the consumer side.”</p>
<p>Ultimately, the goal is changing consumers’ perceptions, so they view electricity not as a convenience, but a product they use on a daily basis. “People want to know exactly what they’re buying,” Flora says.</p>
<h4> </h4>
<h4>Communicating Effectively</h4>
<p><b>TNMP’s SmartMeter Trial Deployment: </b><b>Texas-New Mexico Power (TNMP)</b></p>
<p>• 706,000 customers</p>
<p>• Service areas in Texas and New Mexico</p>
<p>• 300-MW generating capacity (the rest is purchased from other utilities and third-party suppliers)</p>
<p>• $2.5 billion revenue (PNP Resources, 2008*)</p>
<p>*Consolidated operating revenues from continuing and discontinued operations</p>
<p>• <b>Coverage</b>: 10,000 units for residential customers.</p>
<p>• <b>Cost</b>: Undisclosed. TNMP paid for the smart meters out of its operating budget and there was no rate case involved so the amount isn’t public.</p>
<p>• <b>Overview</b>: TNMP’s smart-meter trial in Texas is being done in partnership with SmartSynch, which manufactures IP-based wireless communication equipment for the utility industry that connects to public wireless networks. For the trial, SmartSynch’s wireless communication modules are integrated into GEI210+C digital meters.</p>
<p>“The communication module can fit into anybody’s meter—Elster, Itron, GE,” says Robert Howells, director of program management for SmartSynch. The data bandwidth for AT&amp;T is “massive” while unlicensed radio frequency (RF) mesh networks provide far less capacity, he adds. The argument is that disaster recovery is already built in with AT&amp;T, while a utility would need to buy and maintain that with a mesh network. SmartSynch’s system takes the data collected by each meter, encrypts it, compresses it, and then sends it out over AT&amp;T’s network to a transaction-management system, allowing TNMP to make remote disconnects and reconnects, monitor for outages, and receive notification about a power restoration.</p>
<p>• <b>Returns</b>: While the financials for the smart-meter trial deployment aren’t publicly available, SmartSynch reported in May that TNMP had achieved a 99.96-percent average daily read rate on its 10,000 units in the Texas market. SmartSynch says TNMP also is saving money by avoiding having to build a mesh network and then hire personnel to maintain it. In a statement about the smart-meter trial deployment, Neal Walker, TNMP’s vice president of operations, said that SmartSynch’s use of public wireless networks offers the utility enough bandwidth to use the best security technology on the market.</p>
<p>Over the past year, the smart-grid communications market has been heating up. Verizon also has formed smart-grid partnerships with vendors. Even municipal WiFi company Tropos has repositioned itself as a smart-grid network provider for utilities, saying that its networks have a 3.5-year ROI. With all this competition, utilities might look forward to a wider range of options to fit their goals and budgets.</p>
<p>• <b>Timeline</b>: The partnership between TNMP and SmartSynch began in fall 2007 and the smart-meter deployment began last fall. According to Howells, installations are continuing with a little over 11,000 in use now. Over the next month or so approximately 1,500 more will be put into place.</p>
<h4> </h4>
<h4>Maximizing Customer Service</h4>
<p><b>Westar’s SmartStar Lawrence Project: </b><b>Westar Energy</b></p>
<p>• 684,000 customers</p>
<p>• Service areas in east and east-central Kansas</p>
<p>• 7,100-MW generating capacity</p>
<p>• $1.858 billion revenue (2009, total revenues)</p>
<p>• <b>Coverage</b>: The city of Lawrence, Kansas, including approximately 48,000 meters.</p>
<p>• <b>Cost</b>: $40 million, with $19 million from the DOE and the rest from Westar.</p>
<p>• <b>Overview</b>: This large utility based in Topeka, Kansas, describes its smart-grid approach as cautious but meaningful. The vision for the SmartStar Lawrence project is to gather enough statistically significant data to roll out the most effective measures in the rest of the Westar service area. In addition to nearly 50,000 smart meters, Westar is installing a range of equipment, including automated distribution, a smart grid-enabled outage management system, and internal IT updates.</p>
<p>Both customer service and communication are at the forefront of the project, says Hal Jensen, Westar Energy’s director of SmartStar Programs. The plan is for customers that have Internet access to be able to monitor their electricity use daily and set personal preferences so they receive alerts when their bill is about to reach a certain threshold. Through the project, the utility also wants to determine the best ways to communicate with its customers, whether that means through a Web portal, email, text messages, and even social media tools.</p>
<p>“A lot of this is just figuring out the best suite of services that we can offer that will be effective for everyone involved,” Jensen says. “We want to continue to build a very strong relationship with our customers and continue to be a trusted energy advisor to them.”</p>
<p>Westar is working with eMeter on the Lawrence project, which Jensen says is an advantage because the vendor brings innovative customer marketing experience to the table. “We may be the only choice that the customers have right now but we certainly don’t want to act like it,” Jensen says. “We’ve always said among ourselves here that the best time to build customer loyalty is when you really don’t have to.”</p>
<p>• <b>Returns</b>: Two-thirds of the financing is for the back-end information technology infrastructure, which includes AMI, a meter-data management system, a customer Web portal, and a smart-grid enabled outage-management system, Jensen says. Those technologies are being installed in a way that they will support all of Westar’s customers system-wide while smart meters and localized distribution automation will be unique to Lawrence. Historically, Westar has a high level of customer service, Jensen says. “We think that type of relationship can lend itself to more understanding and more participation in the types of programs we can offer that may have a financial benefit for us—things like potential to defer future generation.”</p>
<p>• <b>Timeline</b>: Westar filed for DOE funding last August and an agreement was signed in March for the three-year project. Planning and internal technology installations will take place during the second quarter of this year through to year end with the meter-installation process, optional customer pilot programs, and customer feedback channel implementations all beginning in 2011.</p>
<h4> </h4>
<h4>Shifting Peak Demand</h4>
<p><b>BGE’s Demand-Response Infrastructure Program: </b><b>Baltimore Gas and Electric (BGE)</b></p>
<p>• 1.2 million electric customers</p>
<p>• Service area in Baltimore, Maryland</p>
<p>• 6,200-MW generating capacity (from holding company Constellation Energy Group)</p>
<p>• About $2.68 billion (2008 regulated electric revenues)</p>
<p>• <b>Coverage</b>: 420,000 residential customers.</p>
<p>• <b>Cost</b>: The overall cost of BGE’s comprehensive smart-grid initiative is $500 million. The demand-response infrastructure program is a subset of this initiative and the cost has not been made public.</p>
<p>• <b>Overview</b>: Rate freezes recently expired in Maryland, and as a result BGE instituted two rate hikes. To reduce energy usage and help customers lower their bills, the utility launched a demand-response infrastructure program in 2008 that’s expected to enroll 420,000 customers over the course of 40 months—a rather high 47-percent penetration. In the program, customers have a choice of getting an air conditioner switch that mounts outside the home or a Honeywell Utility Pro thermostat that mounts inside and is professionally installed. Both the thermostats and AC switches have Cooper Power modules that connect the devices via radio signal back to BGE.</p>
<p>On a hot afternoon in July, the utility can send a signal to participating customers’ AC units or thermostats. The AC unit then will cycle so that it’s off when a neighbor’s unit is on and vice versa, except the resident only experiences a temperature rise of about three degrees. “We’ve had a great acceptance rate and very little dropout,” says Steve Smith, sales and marketing director for Honeywell Utility Solutions. Honeywell makes the thermostats and is also delivering the marketing, field implementation, and customer service for the program.</p>
<p>• <b>Returns</b>: During the summer peak, BGE relies heavily on imported power supplies so the demand-response infrastructure program is one way of addressing this challenge. The utility estimates that its program will cut peak energy use by 600 MW over the next two years, which is about as much as a mid-sized power plant generates. For customers, the thermostats and AC switches can reduce energy costs by up to 20 percent.</p>
<p>• <b>Timeline</b>: The program officially launched in early 2008 and should reach maximum enrollment by June 2011.</p>
<p> </p>
<h4>Managing Voltage Effectively</h4>
<p><b>Volt/Var Conservation Voltage Reduction Program: </b><b>Modesto Irrigation District (MID)</b></p>
<p>• 111,379 customers</p>
<p>• Service area in California</p>
<p>• 700-MW generating capacity</p>
<p>• About $299.9 million revenue (2006 electric revenue)</p>
<p>• <b>Coverage</b>: More than 100,000 customers in its area.</p>
<p>• <b>Cost</b>: $1.5 million from a DOE grant.</p>
<p>• <b>Overview</b>: Modesto Irrigation District is a customer-owned multi-service utility that has long kept a close eye on regulatory activity in the state of California. “There was a big push in demand response, less generation, renewable portfolio standards, greenhouse-gas standards,” says Tom Kimball, assistant general manager for transmission and distribution at MID. “We did a benefit-cost analysis on the types of systems we were looking at to see if they made sense for the organization.” So, about 10 years ago, the utility began a trial advanced-metering infrastructure system.</p>
<p>Over time, the utility implemented automated meter readings, allowing it to save on manpower costs. But the system wasn’t entirely hardcore savings. The payback time initially looked like it could be anywhere between eight to 15 years. “However, the payback drops dramatically based on how much demand response you can achieve by it,” Kimball says. With the DOE grant, MID is now looking at using its meters as part of a voltage/var control and conservation voltage reduction program in order to lower demand. “We think that can be an effective demand-response tool.”</p>
<p>• <b>Returns</b>: MID performed some trials on its system for running the distribution circuits at minimum utilization voltage. Manually, the utility saw 2 to 3 percent potential savings on demand during summer months. “That’s huge,” Kimball says. “Once we get the system up and it can perform that automatically with our substation load tap changers and our capacitor controls for power factor control, as well as our voltage sensing that’s coming out of our AMI meters—if that all really works—it can be a huge saver.” The utility also hopes to see a 5-percent reduction just from time-of-use rates, but that will be tested as well to see if the savings are achievable.</p>
<p>• <b>Timeline</b>: MID plans to start its pilot volt/var conservation voltage reduction program in the third quarter of this year. Time-of-use rates likely will be introduced next year, along with a voluntary program for residential customers to show them what their energy usage is in order to achieve additional demand reduction.</p>
</div></div></div><div class="field field-name-field-article-category field-type-taxonomy-term-reference field-label-above clearfix"><h3 class="field-label">Category (Actual): </h3><ul class="links"><li class="taxonomy-term-reference-0"><a href="/article-categories/smart-grid">Smart Grid</a></li></ul></div><div class="field field-name-field-members-only field-type-list-boolean field-label-above"><div class="field-label">Viewable to All?:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-article-featured field-type-list-boolean field-label-above"><div class="field-label">Is Featured?:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-image-picture field-type-image field-label-above"><div class="field-label">Image Picture:&nbsp;</div><div class="field-items"><div class="field-item even"><img src="https://www.fortnightly.com/sites/default/files/article_images/1006/images/1006-FEA5.jpg" width="1208" height="717" alt="" /></div></div></div><div class="field field-name-field-fortnightly-40 field-type-list-boolean field-label-above"><div class="field-label">Is Fortnightly 40?:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-law-lawyers field-type-list-boolean field-label-above"><div class="field-label">Is Law &amp; Lawyers:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-above clearfix">
<div class="field-label">Tags:&nbsp;</div>
<div class="field-items">
<a href="/tags/aep">AEP</a><span class="pur_comma">, </span><a href="/tags/aep-ohio">AEP Ohio</a><span class="pur_comma">, </span><a href="/tags/american-electric-power">American Electric Power</a><span class="pur_comma">, </span><a href="/tags/ami">AMI</a><span class="pur_comma">, </span><a href="/tags/baltimore-gas-and-electric">Baltimore Gas and Electric</a><span class="pur_comma">, </span><a href="/tags/bge">BGE</a><span class="pur_comma">, </span><a href="/tags/conservation">Conservation</a><span class="pur_comma">, </span><a href="/tags/constellat">Constellat</a><span class="pur_comma">, </span><a href="/tags/constellation">Constellation</a><span class="pur_comma">, </span><a href="/tags/constellation-energy">Constellation Energy</a><span class="pur_comma">, </span><a href="/tags/cost">Cost</a><span class="pur_comma">, </span><a href="/tags/department-energy">Department of Energy</a><span class="pur_comma">, </span><a href="/tags/dms">DMS</a><span class="pur_comma">, </span><a href="/tags/doe">DOE</a><span class="pur_comma">, </span><a href="/tags/elster">Elster</a><span class="pur_comma">, </span><a href="/tags/emeter">eMeter</a><span class="pur_comma">, </span><a href="/tags/ge">GE</a><span class="pur_comma">, </span><a href="/tags/general-electric">General Electric</a><span class="pur_comma">, </span><a href="/tags/honeywell">Honeywell</a><span class="pur_comma">, </span><a href="/tags/infrastructure">Infrastructure</a><span class="pur_comma">, </span><a href="/tags/it">IT</a><span class="pur_comma">, </span><a href="/tags/itron">Itron</a><span class="pur_comma">, </span><a href="/tags/modesto-irrigation-district">Modesto Irrigation District</a><span class="pur_comma">, </span><a href="/tags/smartsynch">SmartSynch</a><span class="pur_comma">, </span><a href="/tags/storage">storage</a><span class="pur_comma">, </span><a href="/tags/time-use">Time-of-use</a><span class="pur_comma">, </span><a href="/tags/time-use-rate">Time-of-use rate</a><span class="pur_comma">, </span><a href="/tags/time-use-rates">Time-of-use rates</a><span class="pur_comma">, </span><a href="/tags/verizon">Verizon</a> </div>
</div>
Tue, 01 Jun 2010 04:00:00 +0000puradmin14217 at https://www.fortnightly.comSelling the Smart Grid - The Pitchhttps://www.fortnightly.com/fortnightly/2008/04/selling-smart-grid-pitch
<div class="field field-name-field-import-deck field-type-text-long field-label-inline clearfix"><div class="field-label">Deck:&nbsp;</div><div class="field-items"><div class="field-item even"><p>Two utilities win customer support for dynamic pricing and demand response.</p>
</div></div></div><div class="field field-name-field-import-byline field-type-text-long field-label-inline clearfix"><div class="field-label">Byline:&nbsp;</div><div class="field-items"><div class="field-item even"><p>Scott M. Gawlicki</p>
</div></div></div><div class="field field-name-field-import-bio field-type-text-long field-label-inline clearfix"><div class="field-label">Author Bio:&nbsp;</div><div class="field-items"><div class="field-item even"><p><b>Scott M. Gawlicki</b> is a freelance writer from West Hartford, Conn. specializing in energy issues. Email him at <a href="mailto:s.gawlicki@excite.com">s.gawlicki@excite.com</a>.</p>
</div></div></div><div class="field field-name-field-import-volume field-type-node-reference field-label-inline clearfix"><div class="field-label">Magazine Volume:&nbsp;</div><div class="field-items"><div class="field-item even">Fortnightly Magazine - April 2008</div></div></div><div class="field field-name-body field-type-text-with-summary field-label-hidden"><div class="field-items"><div class="field-item even"><p>If the recent backlash against California’s proposed new building codes proves anything, it’s that ratepayers won’t buy into the smart-metering concept by themselves. The industry will have to sell it.</p>
<p>That means hammering home the benefits, including an assortment of cost savings, environmental benefits, greater flexibility to make energy choices, and improved grid reliability—<i>i.e.,</i> fewer brownouts and blackouts, and lower transmission system maintenance and operating costs.</p>
<p>Utilities that hope to get around all that by relying on state-imposed regulatory mandates similar to the California Energy Commission’s (CEC) ill-fated proposal almost are certain to fail. In fact, experts say, suppliers would do well to completely avoid the M-word: “mandate.”</p>
<p>“Mandatory direct load control just won’t work,” says Lynne Kiesling, a professor and economist at Northwestern University and a founding member of GridWise Architecture Council. “It’s a sure-fire way to make consumers look at smart grid technologies with suspicion.”</p>
<p>How then should electric utilities, municipals and cooperatives go about introducing smart grid technologies? Two major utilities—Public Service Electric &amp; Gas (PSE&amp;G) and Southern California Edison—are in the early stages of doing just that</p>
<h4>PSE&amp;G’s myPower</h4>
<p>The myPower program at PSE&amp;G ran through 2006 and 2007 and allowed the utility to determine how: 1) price signals can influence a customer’s energy use patterns; 2) how customers react when given the opportunity to shift load during peak periods; and 3) how technology can help them do that.</p>
<p>To examine how and when participants will shift electrical demand to other time periods, PSE&amp;G introduced a tiered rate structure that featured low, medium and high cost time periods, with an extra high critical-peak price.</p>
<p>Instead of the utility’s standard rate of 11 to 12 cents a kilowatt hour, the pilot rates ranged from roughly 8.7 cents/kWh between 9 a.m. and 1 p.m.; 23.7 cents between 1 and 6 p.m.; 8.7 cents between 6 and 10 pm.; and 3.7 cents between 10 p.m. and 9 a.m. During critical peak periods, which occurred five times last summer, the price jumped to $1.46/kWh.</p>
<p>Participants were recruited through a direct mail campaign supplemented by telemarketing calls. The utility offered a cash incentive—$25 upfront and $75 at completion of the pilot—to spur interest. Customers were screened over the phone to ascertain various in-home attributes, such as the type of heating and air conditioning, broadband Internet, and in-home phone lines available.</p>
<p>Those accepted into the program were divided into two segments: One would be notified by the utility via phone or email when PSE&amp;G expected a critical-peak to occur the next day. A second “technology enabled” group received new smart thermostats that automatically responded to price signals sent by the utility. Each group was comprised of about 375 customers.</p>
<p>Once accepted, participants received a new 15-minute interval whole-house meter. Those in the technology group also received the smart thermostat, which was installed and programmed by a PSE&amp;G technician. Customers were able to choose the temperature settings and also received instructions on how to change or override the settings, if necessary.</p>
<p>Fred Lynk, PSE&amp;G’s manager of demand-side marketing, says the company worked hard to ensure customers not only understood how to take advantage of the pricing plan, but how and when they would be alerted to the critical peak days. Educational packets customized by segment included pricing-plan information, thermostat programming guides, and other information and tips. PSE&amp;G created a pilot website to allow participants to view energy usage, compare savings to the standard residential rate, access energy saving information, and pay bills on-line.</p>
<p>“We had to dedicate full-time marketing resources,” Lynk says. “You can’t add this responsibility to someone else’s job.” The company dedicated three full-time employees to the program, including the project manager; a marketing person who designed the customer offer and administrated the program on a day-to-day basis; and a billing analyst who created customer bills and dealt with billing issues. The team’s efforts were supplemented by other utility employees on a part-time basis.</p>
<p>Over the two-year period PSE&amp;G regularly sent reminders that explained how to monitor and shift energy patterns; how to access energy-use data on the company’s website; and booklets with ways to save energy other than cutting back on air conditioning. The reminders were important to the program’s success, says Susanna Chiu, director of utility marketing for PSE&amp;G.</p>
<p>“You have to educate, educate, and educate again. You can’t just send something out once and forget about it. You have to remind customers to cut back and do it over and over again,” Chiu explains. “Cutting back on air conditioning is important, but we also kept reminding them to do the laundry at different times and to turn off lights and appliances not in use.”</p>
<p>Not surprisingly, customers using the smart thermostats reduced their peak-period electrical demand by an impressive 47 percent on summer-peak days. But those notified the day before reduced demand by a still-impressive 20 percent. Overall, program participants reduced their total summer energy use by nearly 4 percent, and most customers saw lower energy bills ranging from $65 to $100 annually.</p>
<p>Most important—at least from a marketing standpoint—is that the pilot proved to be a hit with participants. In follow-up surveys, most said they would recommend the program to a friend or relative and they believed the environment would benefit from programs similar to myPower.</p>
<p>“We learned a great deal about customer satisfaction,” Chui says. “Customers responded to the opportunity to conserve and shift load when power was in peak demand. And from a technology standpoint, we also learned what it takes to operate a system like this.”</p>
<p>In late 2007, PSE&amp;G took the next step in building a smart grid by announcing plans to deploy and test four different advanced metering infrastructure technologies at 32,000 residential, commercial and industrial customer sites. Like myPower, the program will allow customers to monitor energy use, conserve energy and lower their costs during periods of peak demand. The company hopes the New Jersey Board of Public Utilities will approve the program by mid-year.</p>
<h4>Edison SmartConnect</h4>
<p>On the other side of the country, Southern California Edison is proceeding directly to the smart-meter rollout. In 2009, SCE plans to install some 5.2 million smart meters throughout its service territory. However, to get the program off the ground, the utility had some serious public relations challenges to overcome.</p>
<p>“In 2003 and 2004 we were viewed by the California Public Utilities Commission as a company that was not supportive of advanced metering systems,” says Paul De Martini, director, Edison SmartConnect. “We were criticized loudly for that. But in our mind, the technology didn’t support a positive business case, both for us or for our customers.”</p>
<p>As a result, SCE implemented a two-pronged approach. First, it began working with nine advanced metering vendors in 2005 to develop a device based on open design standards (rather than a design standard of a single supplier) that would make it compatible with the next generation of smart thermostats and other home appliances.</p>
<p>At the same time, SCE began assembling a marketing campaign for what would become Edison SmartConnect, a pilot program designed to let customers manage their energy use and save money through new, time-differentiated rates and demand response technologies.</p>
<p>The meters—which will be supplied by at least two vendors—will be able to “talk” through home area networks, providing customers with the near real-time energy use and cost information they will need to conserve energy. The system will allow customers with communicating, smart thermostats (and other appliances) to automatically respond during critical peak pricing and grid reliability events.</p>
<p>Information from the meter into the home will arrive via a two-way wireless interface that will allow customers to immediately see how their actions affect usage. Time-of-use rates will be available in 2009 after the new meters are installed and tested. Customers who elect to participate and move consumption away from afternoon hours should save money.</p>
<p>Marketing campaigns have thus far focused on potential benefits to customers and the utility. For example, the system will make remote service activations possible, enabling the approximately 1 million SCE customers who relocate each year to activate service on demand, rather than scheduling a visit by a service representative. In the future, it will support widespread adoption of solar installations, plug-in hybrid vehicles, energy storage and other clean technologies that will drive greater environmental benefits.</p>
<p>“At the outset, we wanted the message to be that we were going to introduce a new metering program that would benefit our customers,” De Martini says. “People focus on what the utility gets out of it, but we wanted to demonstrate that there’s a lot more to be gained by the customer. These smart meters will improve service and prevent outages. A program like this has to make sense for the customer.”</p>
<p>In focus groups, customers chose the SmartConnect name because it suggested they were the smart ones. “Today’s customers want choices,” DeMartini says. “They want to be in control, and you have to keep options simple.”</p>
<p>In 2009, customers receiving the new meters will receive a follow-up welcome kit. Those who choose to participate in the program will receive certain incentives—yet to be defined—and recommendations on how to shift load and activate the energy-saving thermostats, and instructions on how to navigate the program website to determine energy-saving processes best suited to their lifestyles. SCE’s marketing effort kicked into high gear in 2007 and is expected to continue though 2009 and beyond. In general, DeMartini says, the media response so far has been positive, with feature stories in <i>The New York Times, USA Today, </i>and broadcasts on<i> Fox News </i>and<i> National Public Radio. </i></p>
<p>Utilities planning to roll out similar programs can benefit from the experiences of utilities like SCE and PSE&amp;G, while also learning from the CEC’s cautionary example.</p>
<p>“Objections to the CEC proposal were about the mandate, not the energy efficiency the PCTs would provide,” says Ahmad Faruqui, an economist and consultant with the Brattle Group in San Francisco. “Look at the way CFLs (compact fluorescent light bulbs) were introduced. Now there are states mandating that only those types of light bulbs be available in a few years. Why isn’t that viewed as Big Brother?”</p>
<p>One possible reason is that lawmakers waited until the efficiency benefits of CFLs already were widely known before advancing them as a standard. By contrast, California’s recent backlash against PCTs should be viewed a wake-up call.</p>
<p>“There’s such a fine line between an optional and mandated measure,” he says. “This is not a ‘one size fits all’ scenario. Customers have diverse needs and you have to respect that.”</p>
</div></div></div><div class="field-collection-container clearfix"><div class="field field-name-field-sidebar field-type-field-collection field-label-above"><div class="field-label">Sidebar:&nbsp;</div><div class="field-items"><div class="field-item even"><div class="field-collection-view clearfix view-mode-full field-collection-view-final"><div class="entity entity-field-collection-item field-collection-item-field-sidebar clearfix">
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<div class="field field-name-field-sidebar-title field-type-text field-label-above"><div class="field-label">Sidebar Title:&nbsp;</div><div class="field-items"><div class="field-item even">Public Buy-In Checklist</div></div></div><div class="field field-name-field-sidebar-body field-type-text-long field-label-above"><div class="field-label">Sidebar Body:&nbsp;</div><div class="field-items"><div class="field-item even"><!--smart_paging_autop_filter--><!--smart_paging_filter--><p>Securing public support for dynamic pricing and demand-response programs requires a soft-sell approach:</p><p>• <b>Accentuate the Positive:</b> Consumers are attracted to options that allow them to control their energy costs without interrupting their lifestyle; control the way they consume electricity; support system reliability by reducing the chances of a power emergency; and “go green” as a responsible consumer.</p><p>“It’s all about the message,” says Ahmad Faruqui, an economist and consultant with the Brattle Group. “When energy conservation is presented as a way to reduce the number of power plants needed to serve a specific region, public acceptance is typically very strong.”</p><p>• <b>No ‘Big Brother’ Mandates:</b> Consumers want choice, and they want to be in control of their energy use. Successful programs present the smart grid as an opportunity. In its 2009 pilot program, SCE will install smart meters in targeted areas whether homeowners want them or not. But the homeowners will decide whether to take advantage of the new meter by participating in the pilot.</p><p>• <b>Avoid Techno-jargon:</b> A problem with the CEC’s programmable thermostat (PCT) proposal was that the agency used industry terminology, making it harder to understand the need and benefits of the technology.</p><p>“A proposal that was more sensitive to the public’s knowledge and interests would have defined the conditions under which an emergency signal would be sent to the PCT,” says Northwestern University Economist Lynne Kiesling. “Also, CEC should have emphasized that an emergency signal would not only be rare, but would likely become even more infrequent as the price-responsive demand capabilities and retail choice enabled by the PCTs would reduce strain on the system .”</p><p>• <b>Fly the Green Flag:</b> Energy efficiency and climate change are generating headlines on a daily basis, so successful programs keep those issues front and center. SCE, for example, is promoting SmartConnect as a program that will reduce greenhouse gases and smog-forming pollutants by a minimum of 365,000 metric tons per year, or the equivalent of removing 66,000 cars from the road.</p><p>• <b>Keep It Simple:</b> Energy saving opportunities must be understandable or consumers won’t buy in. An educational program with continuous mailings helps to build awareness and understanding, especially when combined with cost-saving energy use packages and incentives that reward consumers for shifting their electrical load. A program website can make it easy for participants to track their daily energy use and compare their costs against the standard rate. –<span><span class="bolditalic">SMG</span></span></p></div></div></div> </div>
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</div></div></div></div></div><div class="field field-name-field-article-category field-type-taxonomy-term-reference field-label-above clearfix"><h3 class="field-label">Category (Actual): </h3><ul class="links"><li class="taxonomy-term-reference-0"><a href="/article-categories/customer-engagement">Customer Engagement</a></li><li class="taxonomy-term-reference-1"><a href="/article-categories/smart-grid">Smart Grid</a></li></ul></div><div class="field field-name-field-members-only field-type-list-boolean field-label-above"><div class="field-label">Viewable to All?:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-article-featured field-type-list-boolean field-label-above"><div class="field-label">Is Featured?:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-image-picture field-type-image field-label-above"><div class="field-label">Image Picture:&nbsp;</div><div class="field-items"><div class="field-item even"><img src="https://www.fortnightly.com/sites/default/files/article_images/0804/images/0804-FEA1c.jpg" width="1167" height="817" alt="" /></div></div></div><div class="field field-name-field-fortnightly-40 field-type-list-boolean field-label-above"><div class="field-label">Is Fortnightly 40?:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-law-lawyers field-type-list-boolean field-label-above"><div class="field-label">Is Law &amp; Lawyers:&nbsp;</div><div class="field-items"><div class="field-item even"></div></div></div><div class="field field-name-field-tags field-type-taxonomy-term-reference field-label-above clearfix">
<div class="field-label">Tags:&nbsp;</div>
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<a href="/tags/ahmad-faruqui">Ahmad Faruqui</a><span class="pur_comma">, </span><a href="/tags/brattle-group">Brattle Group</a><span class="pur_comma">, </span><a href="/tags/california-energy-commission">California Energy Commission</a><span class="pur_comma">, </span><a href="/tags/california-public-utilities-commission">California Public Utilities Commission</a><span class="pur_comma">, </span><a href="/tags/cec">CEC</a><span class="pur_comma">, </span><a href="/tags/commission">Commission</a><span class="pur_comma">, </span><a href="/tags/edison-smartconnect">Edison SmartConnect</a><span class="pur_comma">, </span><a href="/tags/grid-reliability">grid reliability</a><span class="pur_comma">, </span><a href="/tags/gridwise">GridWise</a><span class="pur_comma">, </span><a href="/tags/gridwise-architecture-council">GridWise Architecture Council</a><span class="pur_comma">, </span><a href="/tags/new-jersey">New Jersey</a><span class="pur_comma">, </span><a href="/tags/new-jersey-board-public-utilities">New Jersey Board of Public Utilities</a><span class="pur_comma">, </span><a href="/tags/pct">PCT</a><span class="pur_comma">, </span><a href="/tags/sce">SCE</a><span class="pur_comma">, </span><a href="/tags/southern-california-edison">Southern California Edison</a><span class="pur_comma">, </span><a href="/tags/storage">storage</a><span class="pur_comma">, </span><a href="/tags/time-use">Time-of-use</a><span class="pur_comma">, </span><a href="/tags/time-use-rate">Time-of-use rate</a><span class="pur_comma">, </span><a href="/tags/time-use-rates">Time-of-use rates</a> </div>
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Tue, 01 Apr 2008 04:00:00 +0000puradmin13829 at https://www.fortnightly.com